91518 Quarterly Country Update ISSUE 38 APRIL 2011 Afghanistan Introduction After an often difficult four month process President Karzai inaugurated Afghanistan’s new Parliament on Wednesday, January 24, 2011. The Parliament spent its first few weeks electing a speaker. After four failed attempts, Abdul Raouf Ibrahimi – an MP from the northeastern Kunduz Province – was elected to the post. An ethnic Uzbek and former border commander in Kunduz province, Ibrahimi received 169 affirmative votes from the 173 members present. One of the new parliament’s first duties has been to consider the SY1390 proposed budget. The total budget for SY1390 is AFN215.9 billion or $4.8 billion, roughly the same level than last year’s budget. AFN150 billion is for operational expenditure and AFN65.9 billion is for development expenditure. Sixty-four percent of the budget will be spent on maintaining security and equipping and training Afghan security forces whereas 20 percent of the outlay would go Since April 2002, to the agriculture sector. The parliament has the World Bank rejected the first draft: the second draft will be re-submitted shortly. has committed over $2.1 billion In his new year speech on March 21, President Karzai inaugurated the “transition” for development process. He announced the first seven areas and emergency where local security forces will take over from NATO, kick-starting a transition designed to A young boy in Kandahar City. reconstruction allow international combat forces to leave projects and four by the end of 2014. They include central budget support Bamiyan Province, central Panjshir Province, four budget support operations. For more information parts of Kabul Province, and Mehterlam city about closed projects, please visit: operations in (the capital of eastern Laghman Province), as www.worldbank.org.af – Projects & Programs page. Afghanistan. well as the cities of Mazar-e-Sharif in northern Balkh Province, Herat city in western Heart The World Bank has provided advice to help the Currently, the Bank Province and Lashkagar city in southern government manage donor funds effectively and in has 23 active projects Helmand Province. Afghanistan’s security a transparent way. The World Bank also supports in Afghanistan with forces are currently comprised of 118,000 the government by providing analytical work on the police and 159,500 army forces. economy, public administration, gender, poverty, the net commitments of opium economy, and public finance management over $900 million. WORLD BANK GROUP SUPPORT (PFM). The Bank has actively supported key reforms, Since April 2002, the World Bank has particularly in the fiscal and public administration committed over $2.1 billion for development spheres, and through its budget support operations. It and emergency reconstruction projects and has advocated building capacity and legitimacy of the four budget support operations in Afghanistan. State and channeling donor resources through the This support comprises over $1.67 billion in government to ensure investments are aligned with grants and $436.4 million in no-interest loans national priorities. To this end, the World Bank works known as “credits.” Currently, the Bank has closely with other multilateral and bilateral agencies 23 active projects in Afghanistan with net across a number of sectors where aid coordination commitments of over $900 million. and government ownership are most critical. So far, a number of Bank-financed projects The International Finance Corporation (IFC), the have been completed which include the World Bank Group’s private sector development rehabilitation of education, emergency public arm, continues to work with its investment partners works, the reconstruction of infrastructure, in Afghanistan. IFC now has an investment portfolio emergency transport rehabilitation, totaling more than $90 million in six companies. health sector reconstruction, emergency This includes commitments in the financial (First communications project and the first phase Microfinance Bank of Afghanistan, BRAC Afghanistan of a public administration project as well as Bank, Afghanistan International Bank), telecom (MTN 1 THE WORLD BANK GROUP IN AFGHANISTAN The World Bank Group’s IFC investment in Afghanistan is currently more than $90 million. Afghanistan), hospitality has been disbursed to the 24,936 communities (Serena Kabul Hotel) and Government of Afghanistan have been mobilized, healthcare (Acomet Family to help cover recurrent and 26,856 communities Hospital) sectors. IFC costs, such as civil servants’ have successfully elected continues to work in various salaries, and over $559.42 Community Development sectors through its pipeline million had been made Councils (CDCs). These of projects in Afghanistan. available for investment CDCs are established projects. through the assistance of The IFC continues 28 NSP Facilitating Partners strengthening the financial The Japan Social who mobilize the community, The Afghanistan sector through capacity Development Fund (JSDF), facilitate elections and building of various financial administered by the World community development Reconstruction Trust institutions. IFC assisted Bank, has provided a special planning through community Fund (ARTF) is a First Microfinance Bank window for Afghanistan which consultation, assist in partnership between of Afghanistan to design; operates in a harmonized project preparation and pilot and roll out a housing manner to support the implementation, and also the international microfinance (“HMF”) national programs of provide capacity building to community and the product to help low income the government. As of CDC members. Afghans meet their housing March 2011, JSDF’s total Afghan government needs. Additionally, Business commitment to Afghanistan Approximately 56,074 for the improved Advisory Services (“BAS”) since its establishment in community subprojects effectiveness of has recently concluded an 2002 had reached $81.3 have been partially or SME Banking diagnostic of million. A number of JSDF fully financed, of which the reconstruction Afghanistan International financed projects have so some 45,350 subprojects effort. Since early Bank (AIB). IFC expects this far been completed. For have been completed. to lead to a more in-depth more information, please About 80 percent of the 2002, 32 donors have advisory engagement. visit http://go.worldbank.org/ community subprojects contributed over $4.2 U5OQZVF200. involve infrastructure such billion (as of March The Afghanistan as irrigation, rural roads, Reconstruction Trust Fund STATUS OF ONGOING electrification, and drinking 20, 2011), making (ARTF) is a partnership OPERATIONS water supply, all critical for ARTF the largest between the international the recovery of the rural community and the Afghan Emergency National economy, stability, and contributor to the government for the improved Solidarity Project (NSP) governance. The community Afghan budget – for effectiveness of the (IDA Grant $398 million, subprojects financed under both operating costs reconstruction effort. Since ARTF Grant $618 million the NSP focus on social and early 2002, 32 donors have and JSDF Grant $15 economic infrastructure and and development contributed over $4.2 billion million): This is the are based on the priorities programs. (as of March 20, 2011), Government of Afghanistan’s of the rural population. making ARTF the largest flagship program to support Of the currently funded contributor to the Afghan small-scale reconstruction community subprojects, budget – for both operating and development activities 24 percent address water costs and development identified by Community and sanitation issues, 16 programs. ARTF’s support Development Councils percent rehabilitate irrigation for national priority programs, (CDCs) across the country. systems, 24 percent improve for operating costs of The project is financed by transportation infrastructure government operations, the World Bank, the ARTF, (e.g. roads, bridges), 15 and for the policy reform the JSDF, and several percent provide energy (e.g. agenda is contributing bilateral contributors. micro-hydro, solar energy), 5 to the achievement of Between early-May 2003 percent improve livelihoods the Afghanistan National and March 2011, the NSP and income-generation, 14 Development Strategy goals. has reached over 18 million percent work on education More than $2.29 billion Afghans. Approximately infrastructure, and 2 percent 22 Utilizing the NSP block grants, over 26,800 communities completed over 45,350 community-based projects such as drinking water supply networks. go towards other investments. Emergency Rural Access to contractors, of which 155 The NSP is active in 359 of Project. In keeping with the contracts are completed Afghanistan’s 364 districts overarching objectives of the and 64 are in progress; 107 and all of Afghanistan’s 34 program, the project aims to contracts are under various provinces. As of March 18, provide year-round access to stages of development. Six 2011, over $844 million basic services and facilities in hundred fifty-one km of the of block grants had been the rural areas of Afghanistan total 1,105 km of the secondary disbursed to CDCs. to enhance the well being of roads and 625 of the total the population and promote 1,197 km of the tertiary roads In addition to subproject economic growth in the have been rehabilitated. implementation, NSP has country. Under the project, Secondary roads have effectively strengthened secondary roads are being generated about 669,400 community-level governance rehabilitated by the Ministry labor days of employment to by establishing a network of Public Works (MPW) and date and the tertiary roads of CDCs. CDCs are the tertiary roads by the Ministry over 860,000 labor days. Out village-level representative of Rural Rehabilitation and of the total budget of $232 body and form a basis for Development (MRRD). million allocated for road interaction within and between The project targets rehabilitation, drainage works, communities as well as with the rehabilitatation of and routine maintenance, government bodies and other approximately 2,300 km approximately $127 million aid agencies. The CDCs are of rural roads and some has been disbursed to date. also increasingly becoming the platform for dispute Due to the increased cost of “To date more than resolution at the community rehabilitation of road works, level. The third phase of NSP the ARTF Management 26,800 communities became effective on October Committee approved on 6, 2010. NSP III plans to November 22nd an additional have sucessfully elected achieve national coverage by funding of $30 million and a rolling out to the remaining $20 million allocation which their community communities in the country was already approved in and also provide a second October 2009. Similarly, the development councils.” block grant to approximately World Bank Board approved 14,000 communities that have an additional financing of $40 already fully utilized their first million on December 16th. block grant. More information 9,000 meters of drainage This brings the total NERAP is available at http://www. structures, generating funding up to $232 million. nspafghanistan.org. 2.13 million unskilled labor Bank management recently days of employment. As of approved the extension of National Emergency Rural February 28, 2011, 82 of the the Project closing date to Access Project (NERAP) 121 secondary roads and December 31, 2013, to allow (IDA Grant $152 million and drainage contracts have the outstanding project works ARTF Grant $80 million): been awarded to contractors, to be completed and fully Following the successfully of which 51 contracts are meet the project objectives. A completed National completed and 31 are in supervision mission has been Emergency Employment progress; the remaining 39 conducted from February Program for Rural Access contracts are under various 7-16 to review implementation project (NEEPRA), the stages of development. On progress since the last mid- Bank, on December 13, the tertiary roads side, 219 of term review mission in May- 2007, approved a grant of the 326 roads and drainage June 2010. $112 million for the National contracts have been awarded 3 Afghanistan Rural Enterprise sustainable microfinance sector that use of public resources. The grants Development Project (AREDP) (IDA will provide flexible, convenient, initially concentrated on funding Grant $30 million and ARTF Grant and affordable financial services to consulting firms to support government $18 million) enhances participation poor people. The goal is to build an officials in carrying out procurement of the rural poor in economic activities integrated financial sector and remove and treasury operations, but have by providing business development the barriers that separate microfinance now shifted emphasis to building services, improving their access to from the broader mainstream financial capacity in procurement and audit finance, and strengthening market system. Since its inception in 2003, functions in the Treasury Department linkages and value chains. The the project has provided more than of the Finance Ministry. The projects project will support the establishment $168 million in funds, including contributed to the establishment of of 13,000 Savings Groups (SGs), $123.4 million in loans. There are now the current modern legal framework 6,500 Enterprise Groups (EGs) and 14 microfinance institutions (MFIs), for public financial management and 1,300 Village and Savings Loan with a network of 249 branches in 26 to the implementation of systems Associations. The EGs will help provinces, and more than 429,989 to support this framework. Activities maximize the economic potential of savings and loan clients. To date, the include: rural entrepreneurs to improve market program has disbursed a total of 1.8 access, deliver technical knowledge, million loans across Afghanistan worth Procurement Advisor: The raise basic business skills, and more than $1 billion. As of January procurement advisor has facilitated leverage economies of scale to 31, 2011, the gross loans outstanding 873 government contracts valued increase the value of their sales. The were $123 million. Sixty percent of the at $2.2 billion. A new procurement project will also work with around clients are women, and 30 percent of law has been enacted and related 750 Small and Medium Enterprises the businesses are run by women. regulations and bidding documents (SMEs) which are likely to be key The ARTF Grant was closed on June have also been prepared along with drivers of rural employment. It will 30, 2010 and the IDA Grant funding standard bidding documents. support SMEs in building necessary which ended on December 31, 2010, skills, promoting market development, has been extended for one more year Procurement Capacity Building and particularly encouraging business to ensure that the project objectives Advisor: A comprehensive needs linkages into the rural economy. are met and to assist MISFA continue assessment for procurement training AREDP has set up offices and to effectively support their current and a plan for addressing the needs recruited provincial staff in Parwan, efforts in ensuring the development have been completed. Training in Bamyan, Nangarhar, Balkh, and Herat of a sustainable microfinance sector procurement rules and procedures provinces. In Parwan, 123 female in Afghanistan. The sector now is underway for procurement staff SGs; 121 male SGs; and 35 EGs employs 3,890 people, 1,465 of whom of all ministries at the Civil Service have been formed. In Bamyan, 103 are women; and over 90 percent of Training Institute for all government female SGs and 85 male SGs have professional positions and 50 percent procurement staff. been formed and in Nangarhar 59 of management positions in the sector female SGs and 126 male SGs have are occupied by Afghans. According to Financial Management Operations been formed. All groups have started findings of the Baseline/Impact study Advisor: An integrated accounting, saving and many have also started of the microfinance sector conducted budget control and check issuance internal lending. The key enterprises in 2007, each MFI loan supports or system has been operating in the that the EGs in Parwan are involved creates 1.5 employment opportunities Treasury Department in the Ministry in include saffron production, poultry in Afghanistan. More information is of Finance since October 2002. All development, livestock rearing and available at http://www.misfa.org.af. budget transactions are recorded in handicrafts. this system which generates timely Public Financial Management and comprehensive reports on the Expanding Microfinance Outreach Reform Projects (IDA Grant government’s budget execution and Improving Sustainability $60.4 million): A series of four and financial position. This system Project (MISFA) (IDA Grant $30 operations support Afghanistan’s has been expanded to all the line million and ARTF Grant $183.3 efforts to establish a transparent ministries in Kabul and all but one of million): The project aims to assist and well-functioning public financial the provincial offices of the Ministry of the government in developing a management system to ensure better Finance, and new programs are being 4 Some 9,487 School Shuras received block grants to improve quality of education. added to support purchasing through 12; (ii) strengthen to improving girls’ enrollment and control of assets. the capacity of communities especially in more traditional to better manage teacher- areas. EQUIP supports the Audit Advisor: The audit learning activities; (iii) promote District Teacher Training advisor has assisted the district-based teacher training Program in 23 provinces (the Control and Audit Office (CAO) activities nationwide; and (iv) balance 11 provinces are with the audits of International provide scholarships for girls supported by USAID). Forty Development Association to attend teacher training two Teacher Training Colleges (IDA) projects, ARTF projects college. Results have been and 730 district-based and cost expenditures, and impressive. Since 2008, an Teacher Training Centers the state budget. In addition, additional 480,000 girls have (TTC) have been established. over 100 staff members have been enrolled, bringing the 750 qualified lecturers have participated in various training total number of girls in school been recruited in 18 provinces courses, including computer to 2.68 million. Similarly, an to teach at Teacher Training and language training, additional 687,047 boys were Colleges. Additionally, 3000 technical audit, and modern enrolled in 2008, bringing the scholarships have been audit working practices and total number of boys in school distributed in 25 provinces to procedures. The CAO is being to 4.385 million. Overall, incentivize and increase girls’ equipped with computers and around 150,000 teachers have enrollment in Teacher Training training material; a strategic been trained, with 65,544 Colleges. Qualified women development plan has been teachers being trained in are trained for a period of two prepared and a new law on 2009-2010 alone. In addition, years at the Teacher Training auditing is proposed. 814 school administrators College after which they join have completed the school the teaching force in their local Internal Audit Capacity management training. communities. Development: The Ministry School Shuras (school of Finance Internal Audit management committees) Strengthening Higher Department is operating an have been established in all Education Program (SHEP) auditing training program provinces, and as of today (IDA Grant $60 million and which has already imparted a 10,462 out of 11,724 MOE- ARTF Grant $32 million): four-month training program supported schools have The program aims to restore to 120 staff of the Ministry functioning school shuras. basic operations at 12 core of Finance and other public Furthermore, school grants universities in Afghanistan — entities and has trained have been distributed to 9,487 Kabul Polytechnic University, internal audit staff from across Shuras. Grants are used by Kabul University, Kabul government, including 40 new Shuras to purchase library Education University, and nine auditors in the Ministry of books, teaching materials, regional universities (Balkh, Defense. computers, laboratory Herat, Kandahar, Khost, equipment, and other school Bamyan, Kapisa, Takhar, The Second Education supplies. With support from Juzjan, and Nangarhar) — Quality Improvement EQUIP I and II, a total of through partnership programs Program (EQUIP) (IDA 10,288 new classrooms have with universities in the Grant $65 million and been built and 637 schools region and in the West, as ARTF Grant $85 million) is have been completed. As well as through competitive fully aligned with the goals noted above, EQUIP has block grants. In June 2010 of the Afghanistan National actively supported the training additional resources of $20 Education Strategic Plan for of teachers with a special focus million equivalent through Solar Years 1385 to 1389). on attracting female teachers World Bank’s International The project is designed to: into the system. Studies Development Association (i) increase children’s access have demonstrated that (IDA) Crisis Response Window to schooling from Grades 1 female teachers are critical (CRW) was approved to scale 5 up these activities while adding 6 more implementation of the 5-year National experienced national and international public universities (Bamyan, Takhar, Higher Education Strategic Plan, training providers. The project has 3 Jouzjan, Khost, Kabul-Education and aligned to the goals of the ANDS. components: Alberoni Universities), in line with the priorities identified in National Higher The ARTF Management Committee Component 1: Mainly focuses on Education Strategic Plan (NHESP). approved a blanket commitment of the establishment of the Afghanistan Funds will also be provided to set up $32 million in 2008 to support the National Qualifications Authority an institutional base to develop an construction of faculty buildings, (ANQF); Afghanistan National agenda for tertiary education, capacity libraries, and gymnasiums, as well Qualifications Framework and building and reform. The program is as master plans and other activities Awarding (ANQF) Boards. Hiring of envisaged as the first phase of a long- to improve academic delivery in the an expert consultancy firm has been term higher education development universities of Balkh, Kandahar, completed and contract signed with program in Afghanistan that will act as Nangarhar, and the Kabul Polytechnic. CINOP (a Dutch consultancy firm) a catalyst to attract various resources The first phase of the ARTF funded on May 19, 2010 to undertake the to the Afghan tertiary education sector. activities is currently underway with $5 above mentioned activities over a million in the form of a Development period of 24 months. The setup for the Under this program, eleven Grant Agreement (DGA) that Committee on Education and Skills partnerships have been formed essentially covers design consultancy Policy (CESP) is in place and chaired for five of the six participating costs of buildings and master plans, by the First Vice President. The CESP universities with eight established capacity building as well as the cost of Secretariat has been restructured and overseas universities. These partner hiring of the staff is ongoing. Eight universities include: Kansas State “SHEP supports 131 junior biweekly Technical Advisory Groups University (USA), University of (TAG) meeting have been conducted, Hartford (USA), San Diego State faculty members to earn model of ANQA and ANQF adopted University (USA), Asian Institute of and draft structure of ANQA and Technology (Thailand), University masters degree in different ANQF will be developed by the middle of Brighton (UK), Delhi University of next month. (India), Ruhr Bochum University fields.” (Germany) and Technical University of Component 2: In pursuance of its Berlin (Germany), focusing essentially mandate to be a model TVET institution, on Engineering, Computer Science, supervising construction of buildings. National Institute of Management English Language, Natural Science Contracts for these activities have and Administration (NIMA) has and Economics/Management. Most been signed for the Universities of been established and it implements partnership contracts have ended Nangarhar, Balkh and Kandahar and competency-based curricula for its by December 2010. However three are being implemented. academic programs. The Maxwell partnership contracts have been Stamp PLC (MSP) took over the given time extensions to allow master Afghanistan Skills Development academic management during the degree students to complete their Project (IDA Grant $20 million second semester with 1,700 students. studies by June 2011. The program and ARTF Grant $18 million): The Meanwhile, the third semester will have trained 131 junior faculty project is designed to increase the was started with 1510 students. A members in master degree program number of skilled Afghans and create significant feature is a Placement by June 2011. The usage of block a high-quality Technical Vocational System where a cooperation-type grants to procure books, teaching Education and Training (TVET) sustainable industry- institution materials, and IT equipment, and to system that is equitable, market linkage is being forged necessitating rehabilitate libraries and classrooms responsive, and cost-effective. the development of competencies and equip laboratories is continuing. More specifically, the project aims to demanded by the industries. To lend Most procurement packages have develop a demand-driven vocational credence to the programs, the MSP been completed as per plan. Also, education and training system, and through the University of Jyvaskyla SHEP, with the support of other give training institutions autonomy to will provide international accreditation development partners, is supporting plan and customize their programs to the programs and possibly the Ministry of Higher Education in the and establish partnerships with national accreditation in the event 6 Under the National Skills Development Program (NSDP), contracts were signed with local NGOs and training providers to train around 7500 poor women, marginalized farmers and unemployed youth. the Afghanistan National buildings and campuses for ANIM. Qualifications Authority in need of renovation and becomes operational. Four physical rehabilitation. Component 3: Under the computer laboratories The physical up-gradation National Skills Development have been equipped with activities undertaken Program (NSDP), contracts 410 computers. The office are: Construction of the were signed with local NGOs equipment for NIMA institute Afghanistan National Institute and training providers to train has been purchased. Several of Music (ANIM): Renovation around 7500 poor women, TVET institutes are also being of the ANIM is complete; the marginalized farmers and supported by the Project: the design for construction of unemployed youth in 13 Afghanistan National Institute new buildings for the Music provinces namely (Khost, of Music (ANIM), the School School has been completed; Zabul, Uruzgan, Kandahar, of Blind, Auto-Mechanical contract for construction of Badakhshan, Samangan, Institute, Construction an alternate building and Bamyan, Ghazni, Paktika, Institute, Women’s Dormitory construction of a library and Kunduz, Baghlan, Faryab, and some buildings for the computer center for the Auto- and Helmand) in wage and Deputy Minister TVET’s mechanical School have been self employment. The training (DMTVET) headquarters. awarded and the construction programs have progressed work is ongoing; construction well and more than 7,390 After a comprehensive of the surrounding wall of participants have completed evaluation of the DMTVET the Auto Mechanical School the training so far and the and its institutes, the German (100 percent complete); training of rest 110 trainees Education and Training (GET) construction of the auxiliary in Helmand will be completed undertook and completed building for DMTVET (80 by the end of February, a review/reorientation of percent complete); the 2011. In order to support the procedures and processes to construction additional classes UN-Habitat Learning and prepare the Deputy Ministry for Takhnike-Sanwi is under Community Empowerment for a decentralized structure. evaluation, construction of Project 2 (LCEP-2) the Policy recommendations learning space for IT Institute procurement process of hiring have been put forward, and (Darul-Aman) has been a consultancy firm to provide capacity building interventions announced, the termination TOT in Business Development have been initiated to prepare of dining hall & cafeteria for Services (BDS) and follow the Deputy Ministry for a Jangalak have been cleared up support for 1500 trainers decentralized management with procurement department of LCEP-2 and 150 trainers system. This covers human of MOE and will to be of other TVET providers is resource management, announced and construction completed and KBDS has curriculum development, of a women’s dormitory. The been selected. The project quality assurance, teacher project has likewise provided makes progress according training, planning and funds for the purchase of to the plan and so far 170 organization, among others. equipment for the Blind trainers received TOT in BDS. As a result of this, interventions School, such as stationary, The main purpose of these and capacity building slide board, stile (chalk), interventions is to improve measures are identified and walking stick, laptop and the livelihoods of the above designed for implementation. Braille computers (completed groups, and especially those and audio equipment covered who can benefit from training In addition, the Project has by Canadian Embassy); and in improved production and provided support to TVET Western musical instruments marketing methodologies, and 7 Infant mortality rate, per 1,000 live births down from 129 in 2006 to about 111 in 2008. more diversification. 1000 live births respectively in 2006. services in Afghanistan by financing With World Bank support in 18 a third party agency to conduct The curriculum and material provinces since 2003, the number annual balance scorecards for development specialist resigned of health facilities has nearly tripled primary health care facilities and and hiring of new curriculum from 148 to 432. About 85 percent hospitals. and material specialist and other of the population lives in districts, technical consultants are in process which now have service providers Implementation of an innovative to support the NSDP curriculum to deliver a basic package of health results-based financing (RBF) and standards development team in service. However, 57.4 percent of mechanism to improve coverage development of Competency Based the population lives within one hour and quality of services in health Training standards at different level walking distance from a public health facilities is making satisfactory for the most demanded skills. So far facility (based on NRVA 2007/2008). progress. In addition, $17.9 million 84 standards have been developed Health service utilization increased has been approved through JSDF by the team and some of these among project area populations to co-finance the SHARP project. have already been introduced to the from a rate of 0.3 consultations This allows the project to provide training providers. per capita annually at the outset to BPHS services for Balkh, Samangan 1.21 per capita by the mid 2010. and urban Kabul for three years. In The Government of Norway and Health care for expectant mothers addition, $22 million, which had been USAID are co-financing the project expanded, with the number of approved by the ARTF, is being used in the amount of $12 million and deliveries assisted by trained health to co-finance the implementation of $6 million respectively through the workers jumping from 6 percent BPHS in 11 provinces - in Helmand, ARTF. The project is expected to be to 24 percent (NRVA2007/08). Badghis, Farah, Nimroz, Samangan, completed by February 2013. The number of pregnant women Balkh, Wardak, Sar-e-Pul) through who received at least one prenatal NGO contracts, and in Kapisa, The Strengthening Health care visit rose from 11 percent in Panjshir, and Parwan through Activities for Rural Poor Project 2004 to 36 percent in 2008. Child direct delivery by MOPH, under (SHARP) (IDA Grant $79 million, immunization rates are still low but the stewardship of the Ministry in ARTF Grant $22 million, JSDF have improved from 12 percent in guiding implementation and policy Gran $17.9 million, $12 million 2005 to 33 percent in 2008. Around dialogue for the Essential Package from Multi Donor Trust fund 20,000 community health workers— of Hospital Services. The Bank has for health results innovation): half of them women—have been also approved Additional Financing SHARP aims to improve the health trained and deployed throughout from the Crisis Response Window in and nutritional status of Afghans, the country, increasing access the amount of $49 million equivalent focusing especially on women to family planning and boosting to expand SHARP’s implementation and children and the underserved childhood vaccinations. The number capacity to deliver basic health and areas of the country. The project of facilities with trained female health hospital services to the vast majority supports Afghanistan’s Health and workers rose from 25 percent before of the poor. Provision is being made Nutrition Sector Strategy, which is the project to 74 percent today. to include (a) mental health and the blueprint for the government’s enhanced nutrition services in the health sector program for the period SHARP finances provision of the new BPHS package; and (b) improve 2008-13. Basic Package of Health Services hospital services critical to reduce in eight provinces (Helmand, Farah, maternal and child mortality. The National Risk and Vulnerability Badghis, Nimroz, Samagan, Balkh, Assessment (NRVA) 2007/08 Wardak, and Saripul) through Afghanistan HIV/AIDS Prevention indicate good progress in reducing national and international NGOs Project (IDA Grant $10 million) infant and under-five mortality. Infant contracted out by Ministry of Public is designed to strengthen national and under five mortality in 2008 Health (MoPH). The MOPH has capacity to respond to the epidemic has declined to 111 (13 percent signed all the BPHS service delivery by scaling up prevention programs reduction) and 161 per thousand contracts for 8 provinces of the targeting people engaged in high live births (15 percent reduction) country. SHARP also supports risk behaviors. These vulnerable respectively from 129 and 191 per monitoring and evaluation of health groups at high risk include injecting 8 The World Bank’s Interim The number of facilities with trained female Strategy Note (2009-11) is aligned with Afghanistan’s health workers rose from 25 percent in 2003 to 74 National Development Strategy (ANDS) and is designed around percent in 2010. three main pillars: Building the capacity of the drug users (IDUs), sex AIDS program. Injecting the successfully completed workers and their clients, drug use is the major source Emergency Customs state and its accountability to its truckers, and prisoners. of new HIV infections, with Modernization and citizens: The Bank will continue The project also aims to transmission highest in Trade Facilitation Project improve the knowledge Western Afghanistan. HIV (ECMTFP) and to continue to strengthen core government of HIV prevention among prevalence is significant with the reforms underway, the general population, among prisoners and the World Bank Board systems as the basis for strengthen surveillance of approved a new follow-on credible state building. Efforts HIV prevalence and high risk “Child immunization project on June 25, 2010. behaviors, map and estimate The project will continue to will be made to strengthen the sizes of groups engaged rates increased from consolidate the customs public financial management in high risk behavior, and modernization process, use communications and 12% in 2005 to 33% in and is specifically focused and fiscal sustainability, and advocacy to reduce stigma on anticorruption and on related to HIV and AIDS. 2008.” improving the release of improve transparency and legitimate goods in a fair accountability. Assessments Since its approval in and efficient manner. The July 2007, the project appears to be related to grant helps finance costs of vulnerability to corruption has contributed to the proportion of injecting associated with: countrywide will be integrated into ongoing strengthening the capacity drug users in prison. HIV computerization of customs of the National Aids Control prevalence is zero among clearance operations; work. Program (NACP) through both sex workers and installation of executive (i) recruitment of seven road transport workers, information systems for national advisors and one suggesting limited sexual customs, allowing real-time Promoting growth of the rural international advisor; (ii) transmission. monitoring of operations; participation of NACP staff development of possible economy and improving rural in national/international Based on the options for cross-border Customs-to-Customs livelihoods: Support to the rural training activities; and (iii) recommendations of the exposure of NACP staff mid-term review, the project cooperation; provision economy and livelihoods will to well performing HIV/ was restructured in February of selected customs AIDS programs abroad. 2010. The restructuring infrastructure to enable remain a priority for the Bank. The increased capacity of includes: (i) Modification modernized operations; Rural programs also serve NACP has resulted in the of the project performance and technical assistance to adoption of the Afghanistan indicators; (ii) cancellation support the development of as important entry points for HIV Code of Ethics, an of part 4.2 in schedule 1 to a regulatory, administrative, and institutional framework shifting economic incentives important milestone for the Financing Agreement the support and protection (innovative initiatives sub- for customs. Through away from opium and toward of people living with HIV/ component); (iii) expansion these initiatives, the project AIDS in the country. The of the project scope including continues the World alternative, legal, high value program also finalized the possible extension of the Bank’s efforts to reform agricultural products. policy on Opioid Substitution provision of harm reduction and modernize the Afghan Therapy. The HIV/AIDS services for injecting drug Customs administration policy development is in users (IDUs) to Farah and initiated in 2004 when the ECMTFP began. Supporting growth of the formal an advanced stage which Nimroz provinces where the will be finalized soon. To HIV epidemic is believed private sector: The World achieve its objectives, to be high (dependent on The ECMTFP (IDA Credit the NACP has signed 12 the results of the rapid $31.2 million and IDA Bank Group will continue to contracts with national and IDU assessment in these Grant $6.81 million) closed address the overall constraints international organizations, provinces); and (iv) extension on December 31, 2010. and the harm reduction of the Project Closing Date To ensure continuity of to private sector development activities have been from December 31, 2010 to reforms and to avoid loss of momentum, the Government through lending and advisory initiated. Comprehensive June 30, 2012. Most of the integrated biological- NGO contracts have been of Afghanistan has provided work. It will identify and address behavioral surveillance extended up to June 30, $2.8 million from its own (IBBS 2009) has been 2012. resources as bridge financing specific measures that catalyze completed among priority for the interim period until the business growth and will invest populations of injecting drug The Second Customs Second Customs Reform users, prisoners, female sex Reform and Trade and Trade Facilitation directly in local companies, workers, and road transport Facilitation Project Project became effective, on December 28, 2010. The including banks, to help them workers. The results of (SCRTFP) (IDA Grant the survey have important $50.5 million): Building ECMTFP is currently in the expand business. implications for Afghanistan’s on the overall success of Implementation Completion 9 9 Report phase. Logistics Performance Index (LPI) 726,000 ha of land in various parts has improved notably from 150 in of the country have been completed. The ECMTFP has helped improve 2007 to 143 in 2010. In relative As a result of the rehabilitation, an the valuation of goods, reduce terms, as compared with the country additional 145,000 hectares of land leakage of revenues, and decrease with the highest score, Afghanistan’s area are now receiving irrigation the waiting time at major border performance increased from 6.6 supplies, and crop yields have crossings. One of the project’s percent of the highest performer in increased substantially. In addition, key achievements has been the 2007 to 39.9 percent in 2010. the work under the Feasibility Study automation of customs processes of the Lower Kokcha Irrigation and with the Automated System for Hydropower Multipurpose Project on Customs Data (ASYCUDA). To the Kokcha River in the Amu River date, Customs processes have “The first customs project Basin has been completed, and the been automated at major Inland final report was submitted in April Customs Depots (ICD), including helped improve valuation of 2010. Installation of 105 of the 174 at the Kabul Airport, which receives hydrology stations in different part approximately 55 percent of all the goods, reduce leakages and of the country has been completed. country’s customs declarations. Work on installation of 40 Cableways ASYCUDA is now functional at five decrease waiting time at major has commenced. These facilities transit axes, which receive some will enable measurement of river 65 percent of Afghanistan’s transit border crossings. “ flows for future use in planning and trade by value thus improving the developing water resources in the collection of transit fees in major country. transit corridors in Afghanistan. Full The Emergency Irrigation Declaration Processing System is Rehabilitation Project (IDA The Afghanistan Investment now operational at five locations. Credit $40 million, IDA Grant Guarantee Facility (AIGF), in Customs revenues have soared $86.5 million, and $6 million cooperation with Asian Development from $50 million in 2004 to over Government Funds): The project Bank (ADB), Department for $400 million in 2008 and almost is helping to provide water to farms International Development (DFID), doubled at the end of March 2010, in the project areas, with more and World Bank’s Multilateral reaching over $700 million - an reliable and equitable distribution of Investment Guarantee Agency increase of more than 1,400 percent irrigation water. The rehabilitation of (MIGA), aims to assist Afghanistan in six years. In fact, in the last year, the national irrigation system in all in its reconstruction efforts by Customs revenues have increased five river basins of Afghanistan will stimulating foreign direct investment by about 90 percent. This was help increase agricultural productivity through a program of political risk largely attributable to computerized and farm income, improve food insurance in an environment where control over transit shipments, tighter security and livelihoods, and reduce the perception of political risk by control over the clearance of goods, vulnerability due to droughts. To foreign investors is very high. The and the enhanced capacity of the date, six regional offices in Kabul— project is designed to stimulate Afghan Customs Department (ACD) Jalalabad, Kandahar, Balkh, Kunduz, private business activity and attract staff. The waiting time for trucks and Herat—have been established foreign private investment in a variety at the major border crossings has to develop institutional capacity at of sectors. It will stimulate the local also decreased. For example, at the local level. As of January 31, economy, generate employment, Torkham, at the eastern border with 2011, 775 subproject proposals, create tax revenues, and assist in the Pakistan, over 90 percent of trucks costing about $90 million, had been transfer of modern technologies and are now cleared in less than one and prepared. Of these, 774 subprojects business practices to Afghanistan. a half hours, down from 18 hours in totaling $89.4 million have been 2003. At the Kabul Inland Clearance approved; contracts for 767 Despite the deteriorating business Depot, the average waiting time subprojects worth $75.9 million are environment which impeded the for trucks is a quarter of what it ongoing; and 679 medium and large flow of foreign direct investment to used to be before computerization. size traditional irrigation schemes Afghanistan, the AIGF has been Afghanistan’s ranking of Customs worth $55.8 million serving more than making steady progress. To date, a 10 Da Afghanistan Brishna Shirkat (Afghanistan Power Utility) has significantly improved power supply to Kabul. total of six guarantees have persons have already received within the Gozars. been underwritten with the improved services, and AIGF for two beneficiaries approximately another 50,000 The Emergency Power covering the agricultural, are in the process of receiving Rehabilitation Project (IDA financial, construction, services. As of December Credit $105 million and and telecommunication 27, 2010, 8,639 street lights ARTF Grant $20 million): sectors. There are potential have been installed, 8,310 The project is working to projects which are now being latrines have been improved, provide improved and more examined. These are (i) 147 km of drainage and 120 reliable supply of electricity underwriting of an investment km of roads, 91.2 km of water to the residents of Kabul. It is of $100 million in the telecom supply scheme, 36 unit of solid doing so by rehabilitating and sector; and (ii) underwriting of waste collection point and two expanding city distribution an investment of $3.5 million deep wells with water pump networks; connecting the in the agriculture sector to set and other facilities have been Kabul city grid to the future up a cold storage for fruits. constructed or rehabilitated North East Transmission The due diligence process have been constructed or System to allow for the is in progress, and the rehabilitated. import of lower cost power underwriting will be completed from Uzbekistan into the city; in June 2011. The total In each neighborhood, rehabilitating the 100 MW associated foreign investment community-based Gozar Naghlu Hydropower Plant of the projects under the Cooperative Shuras are (the largest hydro generation AIGF is about $107 million formed to represent women station in Afghanistan which with approximately 850 jobs and men of the area. The supplies power to Kabul) and created as a result. The above project has initiated a program the associated transmission two additional investments will of community consultation to line; and restructuring and increase the coverage of the booster community support commercializing the power project from $107 million to for the project and to build utility to improve service $210 million and the number community area upgrading. delivery. of jobs from 850 to 940. Given The shuras identify community the importance of the project needs which are integrated A majority of project in attracting foreign direct into a Community Upgrading components have been investment, and at the request Plan (CUP) covering water completed and the facilities of Government of Afghanistan, supply, access roads and are in use and providing the the closing date of AIGF has drains, sanitation, solid waste desired services, including been extended for two years management, and street the rehabilitation of a 110kV from September 30, 2009, to lighting (i.e. urban services). transmission line from September 30, 2011. Shuras are very important in Naghlu to Kabul; 110 kV managing local infrastructure of new transmission lines Kabul Urban Reconstruction and organizing a solid waste from Chimtallah substation Project (IDA Credit $25 collection system where a to Kabul North; supply and million and ARTF Grant collector/sweeper contracts installation work of optical $8.8 million): This ongoing with the Shura, and health fiber ground wire from Pul- urban upgrading project and hygiene campaigns on e-Khumri to Chimtallah 220 benefits formal and informal clean water and sanitation. kV transmission line; and neighborhoods, including In addition, the Shura rehabilitation of 110 kV North- four neighborhoods in the Old plays a vital role during the West and North Substations. City of Kabul. About 200,000 implementation of the project Unit no. 4 of Naghlu 11 hydro project was also October 2010. The revised the Horticulture component. commissioned in October objective is to assist the Over 2,839 ha of new 2010, and commissioning Government of Afghanistan orchards have been planted of Unit no. 3 is expected in to develop the capacity which makes 95 percent of April 2011. However, this of the Afghanistan Urban the set target of 3,000 ha. component of the project Water Supply and Sewerage Four additional crops -- apple, and the 110kV transmission Corporation (AUWSSC) for peach, plum, and cherry line from North Substation operational management -- were introduced during to the Eastern line continue and investment planning and fall season campaign (the to experience significant implementation. To achieve previous crops were almond, delays due to security the revised objective, apricot, pomegranate, and considerations, right of the restructured project grape). Over 600 female way, and some contractual included (i) modification of farmers have participated in issues. The government the project scope to reflect the new orchard’s scheme. has requested additional the cancellation of the Besides receiving input, they financing from the World Kabul water supply system have received extension Japan Social Bank for both contracts component; (ii) addition of messages. The component Development Fund which are currently under two new activities for the also supports existing review. preparation of a new water orchards by providing (JSDF): supply project for Kabul and extension messages and The JSDF was DABS (Da Afghanistan a pilot scheme for expanding inputs through farmers’ field established by the Brishna Shirkat – water supply services by schools. Afghanistan Power Utility) small private operators; Government of Japan has also significantly (iii) revision of the project Under the Animal Health in 2000 as a means of improved the power supply development objective and Component, in addition to to Kabul, as well as billing project results and indicators; 114 government veterinary supporting activities and collection. By December and (iv) extension of the clinics transferred to trained which directly respond 2010, DABS had fulfilled current grant closing date veterinarians for private to the needs of poor the ARTF benchmarks for to June 30, 2012, to enable operation, 53 more clinics FY1389 relating to improved completion of the technical have been identified and and vulnerable commercial performance: it assistance and capacity assessed for similar transfer. groups, enhance had opened five Customer building activities for the The poultry subcomponent Care Centers in Kabul; met water supply and sewerage has helped poor women their capacities, and revenue from billed energy utility. enhance their incomes from strengthen their cash realized per kWh energy poultry production. Under empowerment and supplied benchmarks; and Following the announcement this component, over 12,800 established a hotline for of the sector policy and intensive poultry units have par ticipation in supply-related complaints. institutional development already been established, the development plan in October 2005, a out of which 7,000 units were Given the delays, and after Presidential Decree to established in 2009, and process. The fund the revised work schedule corporatize CAWSS was 5,800 units were established is administered by agreed between the parties, issued in January 2006. at the beginning of 2011. the World Bank. the closing dates of the IDA The Articles of Incorporation So far, over 13.8 million Credit and ARTF Grant have of the new AUWSSC were eggs have been produced. The Government of also been extended from the approved by the Cabinet on Furthermore, 200 small- Japan and the World original dates of September July 9, 2007, and gazetted scale broiler units were also 30, 2010, and June 30, 2010, by the Ministry of Justice on established by December Bank agreed to set respectively, to September July 11 2007; the Board of 2010. Out of 7,000 units up a special window 30, 2012. Directors is meeting regularly, established in 2009, 94 within the JSDF to and the management team, percent have started the Urban Water Sector Project comprising of General second production cycle support activities (IDA Grant $17 million): Manager, Finance Manager, without financial assistance in Afghanistan The project which originally Operations Manager, and from the project, which aimed to (i) transform the Deputy Technical Manager, demonstrates sustainability. under a multi-year Central Authority for Water Internal Auditor, and Heads program of assistance Supply and Sewerage of six Strategic Business Sustainable Development for the country’s (CAWSS) into a technically Units, has been appointed. of Natural Resources viable operation; (ii) establish AUWSSC took over the Project (IDA Grant $40 reconstruction and the financial sustainability entire urban water supply million Grant): The project transition toward of the Afghanistan Urban and sewerage operation in supports measures to Water Supply and Sanitation the country. External auditors enhance regulatory capacity, political, economic, Corporation (AUWSSC,); have been appointed, and foster private sector and social stability. (iii) increase access to the consulting contract development and adherence and reliability of the water for obtaining technical to international standards. supply service in Kabul; assistance has been This project is helping the and (iv) prepare a follow-up finalized. government to ensure that project under which more the revenues from these substantial institutional Emergency Horticulture valuable resources are and financial objectives and Livestock Project (HLP) available to the country as a can be achieved and (IDA Grant $20 million and whole and are transparently coverage further expanded ARTF Grant $34.3 million): managed. Among the in Kabul and provincial The project is making good approaches the government towns, was restructured in progress especially under will use to manage the sector 12 12 Under the Horticulture and Livestock Project, over 2,800 hectares of new orchards have been planted. is the Extractive Industries years, and an initial payment contract, is placed in a newly Transparency Initiative – a of $80 million has been established filing system set of principles that supports received by the government. (hard copy), with a copy of the sector governance via the full In a short while, the project contract as obtained from the publication and verification will guarantee the supervision Department of Extraction. To of company payments and of contractual obligations date, 69 quarries have been government revenues from oil, of the Aynak development, located. The filing system is, gas, and mining. In addition, an with an emphasis on social however, being progressed. International Advisory Council and environmental issues. The program is also used for has been established to assist Important steps have been training in the use of GPS the government in evaluating undertaken with regard to the instruments in a real situation. the strengths and benefits of cultural preservation of the The Mineral Resource contracts to ensure that best Buddhist antiquities which are Development Corridor has practices are applied to help located in the Logar valley: been researched, maps were Afghanistan in developing its The project supports a rapid prepared, and the concept of natural resources. archaeological assessment the Resources Development as well as the development Corridor was developed and Despite a number of of a full recovery plan, with received high commendation constraints—notably a difficult the overall goal to rescue and from the World Bank. New business environment—the exhibit these artifacts. Since plans to enhance and promote project has made steady end of 2010, the project has the concept by developing a progress since its inception. supported the government comprehensive geo-scientific Significant strengthening to initiate the Hajigak tender database are under way as are of the Ministry of Mines process. Hajigak is a world plans to develop an inventory departments responsible class iron deposit and will of mineral assets and promote for cadastre and mine title be Afghanistan’s biggest mineral assets for Afghanistan management has been mine and indeed one of by mineral districts and conducted as well as training the largest in the region, mineral deposits. In addition, courses for the Afghanistan once operational. The WB- the project will assist AGS Geological Survey. Mining supported tender process has with the planning and regulations have been drafted already shortlisted interested management of conducting and environmental regulations bidders, and is expected to countrywide a regional stream are under preparation as be concluded toward the last sediment geochemical survey, well as other guidelines and quarter of this year. geochemical database and procedures for the Ministry interpretations, and mineral of Mines. Significantly, A quarry/mine verification deposit assessments. the project has stimulated exercise is being undertaken The project is also helping private sector investment in using members of the the government through Afghanistan by facilitating Extraction Department and Transaction Advisers with the successful tender of the the Inspection Department bidding procedures of the Aynak copper deposit, one of the Ministry of Mines. The Hajigak Iron Ore Deposit, of the largest such deposits exercise is using hand-held which is one of the world class in the world. The government GPS instruments to obtain iron deposits. has concluded the contractual coordinates of actual quarries agreements with the Chinese around Kabul, photographs In addition to strengthening company which was awarded are taken of the GPS and the Ministry of Mines’ capacity the tender. The total amount of site, and this information, to supervise the mining sector, the investment will be around together with other the project is helping the $10 billion over the next 5 to 10 information regarding the government move towards its 13 goal of ensuring transparency and implementing projects. (iii) institutional framework and good governance in the sector. The management arrangement, and (iv) government has taken the important Civil construction work of the implementation action plan. step of endorsing the principles of the park, which includes leveling, Extractive Industries Transparency boundary walls, road work, storm Civil Service Reform Project Initiative (EITI) and has been water drainage, and water supply (IDA Grant $20.4 million): The awarded “candidate” status by the system, is now fully completed. This project supports the Independent EITI secretariat in Oslo. An EITI represents 40 percent of the total Administrative Reforms and Civil Secretariat and the National Multi project cost. The power distribution Service Commission (IARCSC) Stakeholders Group, with a broad network and street lighting of the and key government ministries participation of government, private park is being constructed. The design in improving their capabilities for sector, and civil society groups, contract for wastewater treatment management of human resources. have both been established to run was awarded in September 2010. To meet this objective, the project and oversee EITI implementation The major constraint that the project supports the government in the processes in Afghanistan. is experiencing relates to power development and implementation supply. The project was designed of clear rules and procedures for Private Sector Development in 2006, when the grid station was managing civil servants. The project (PSD) Support Project (IDA Grant not available in Jalalabad City. The also supports core ministries to $25 million): The project aims Asian Development Bank (ADB) reorganize their structures and to stimulate the local economy is financing a transmission line staffing so as to better perform to generate employment, create from Naghlu hydro power station their tasks. In addition, the project income and alleviate poverty. It to Jalalabad city and building a supports ministries to implement the helps create an economic enclave substation in Jalalabad. An MOU Pay and Grade reforms. for businesses operating in both the has been signed between Da domestic and export markets. The Afghanistan Brishna Sherkat (DABS) Financial Sector Strengthening project supports: (i) constructing and AISA which states that DABS Project (IDA Grant $8 million): The an industrial park at Hisar-e-Shahi, will provide 25 MVA hydropower to project supports the Afghanistan (ii) establishing industries in 4 key the Hussar-e-Shahi industrial park. National Development Strategy’s sectors (light engineering, food vision to establish a modern and processing, leather garments, carpet Since the project is located 24 km competitive financial sector. The washing and finishing); (iii) building from Jalalabad city, it would be project will specifically strengthen AISA’s (Afghanistan Investment possible to extend the ADB-financed the capacity of Da Afghanistan Support Agency) capacity in the transmission line to the Hisar-e-Shahi Bank (DAB) in the area’s offside Industrial Parks Development industrial park and install a substation banking supervision, accounting, Department (IPDD) and Research to supply the power from the grid to internal audit, and human resource and Policy Department (RPD); and the park. The transmission line from management. It will also develop (iv) creating capacity in the Private Jalalabad city to the industrial park necessary financial infrastructure Sector Development Directorate and the substation could potentially such as a public credit registry, (PSDD) of Ministry of Commerce be financed under the PSD Support collateral registry, and the and Industries (MoCI) to design Project. The project closing date is Afghanistan Institution of Banking PSD related policies. The capacity June 30, 2011. In order to complete and Finance (AIBF). AIBF was of IPDD has been substantially the planned activities, the project officially inaugurated on November improved in financial management, would need to be extended for at 10, 2010. Furthermore, the procurement, environmental and least two years and would require agreement for regional collaboration social management, and project additional financing. To help reach for AIBF was signed between supervision. However, the high staff a decision on whether to extend the Da Afghanistan Bank (DAB) and turnover has constrained the ability project and to request additional Bangladesh Institute of Banking and to implement projects independently. financing, AISA will shortly complete Management on December 8, 2010. Similarly, a number of staff in PSD a study which will focus on the Under this agreement, BIBM will help department of MoCI have been following aspects: (i) industry sector AIBF’s capacity building, training, trained to improve their capacity assessment and demand analysis, and curriculum development. The in undertaking policy analysis and (ii) economic and financial modelling, consultants for the positions of audit, 14 The Bank’s new Global Food Crisis Response Program helped rehabilitate 379 small irrigation schemes, benefiting over 6,900 families. human resources, accounts, be considered one of the included cleaning of canals/ and procurement have been most modern in the region. karezes, as well as building recruited. At the request of It allows both public and of protection walls, gabion the Central Bank, the project private credit reporting to be walls, water dividers, and will finance in-depth audits established in Afghanistan. intakes. With rehabilitation of of 10 commercial banks It also introduces, for the these schemes, over 6,900 operating in Afghanistan. The first time, ample borrowers’ families in far remote areas recruitment of the auditing privacy rights and allows for of Afghanistan have been firms is ongoing. the establishments of Private provided with access to Credit Bureaus in the future. improved irrigation systems Through this project, IFC It has been constructed which will enable farmers to is also providing technical to attract leading private expand irrigated farmland. assistance to the Central Bank providers (mandatory sharing in order to establish two basic and mandatory inquiries with Afghanistan Pension financial sector infrastructures borrowers’ consent, closure of Administration and in the country: (i) a Public the PCR to inquiries when the Safety Net Project (IDA Credit Registry that will provide first PCB opens) and allows Grant $7.5): The project lenders with information for the participation of regulated is designed to improve the efficient risk assessment on and non-regulated entities. administrative capacity of borrowers; (ii) a Collateral the public pension system to Registry for movable property Afghanistan Food Crisis ensure the effectiveness of that will provide lenders Response Project ($8 million a reformed pension scheme with the ability to effectively Grant): The Bank’s new for public sector employees. use borrowers’ property as Global Food Crisis Response It will also develop a policy collateral. IFC’s involvement Program provided assistance framework for safety nets, in these two projects includes for the rehabilitation of and on that basis implement an assessment of the legal approximately 476 small a pilot safety net program and regulatory framework, irrigation schemes, critical to for needy households, with support in the preparation the recovery of the country’s a subsequent proposal for a of the necessary new laws agriculture. The project scaled-up national approach. and regulations required closed on September 2010 The project aims to develop for the establishment of this at which time approximately capacity in the Ministry of infrastructure, assistance in $7.1 million had been Labor and Social Affairs to raising awareness among the disbursed overall, of which plan and administer programs relevant stakeholders, and $6.8 million was disbursed in pensions and safety nets. providing advice regarding the directly to rural communities At present, the pension necessary IT systems. IFC is for implementation and beneficiary survey is halfway also engaged with the Central construction work of into its implementation; an Bank to establish the legal irrigation subprojects. Of IT firm has been contracted framework for leasing. these, 379 subprojects to implement a new have been completed by computerized system for the The Afghanistan Credit the communities, while the Pension Department; various Reporting Regulation was remaining 97 subprojects are manuals for the new benefit approved by the Supreme still ongoing and funds for application process are Council of Da Afghanistan these subprojects have been close to completion; a public Bank on June 05, 2010. The fully disbursed into community information campaign for the new regulation will be in force bank accounts. HR officers and employees after the official publication of the government agencies in the Gazette, and can These irrigation schemes will soon be rolled out. On 15 How the Afghanistan Reconstruction Trust Fund (ARTF) works: Donors contribute funds into a single account, held by the World Bank in the US. The ARTF Management Committee makes decisions on proposed allocations at its The Afghanistan monthly meetings, and those decisions Reconstruction Trust are translated into funds through Grant Agreements signed between the World Fund (ARTF) was Bank and the Government of Afghanistan. established in April ARTF allocations are made through two 2002 as a temporary “windows”: the Recurrent Cost Window and the Investment Window. The Recurrent means to finance the Cost Window reimburses the government government’s wage for a certain portion of eligible and non- bill. Now the ARTF has security related operating expenditure every year. The Investment Window provides developed into the main grant financing for national development multi-donor funding programs in the development budget. mechanism in the the safety nets side, a new to the achievement of Grant): To date, the ARTF country – financing both targeting instrument has the Afghanistan National has disbursed $2.15 billion been developed and a Development Strategy goals. through the government’s the essential running comprehensive Operational operating budget. Domestic costs of government Manual for the pilot has been Management: The ARTF revenues continue to be developed. A small-scale is managed by the World insufficient to cover the costs as well as key Afghan proof of the concept pilot Bank as Administrator of of government. The ARTF National Development (covering 22 villages and the fund. The Management Recurrent Cost Window has around 500 beneficiaries) is Committee consists of the therefore ensured the basic Strategy (ANDS) underway in Farza district of World Bank, the Islamic functioning of government Kabul province. The second Development Bank, the including the delivery of programs across the phase of the pilot program Asian Development Bank, services such as healthcare country. The objectives will be fully rolled out in three UNDP and the Ministry of and education. Given that districts of three different Finance. The Management around 60 percent of the of ARTF are to: provinces during the spring. Committee meets regularly non-uniformed Afghan civil Evaluation of the pilot will be in Kabul to review the service is accounted for by conducted by a specialized ARTF finances and approve teachers, the Ministry of • Position the national firm hired for this purpose funding proposals. Once a Education has in general by the Ministry. It will cover quarter, ARTF Donors meet received around 50 percent budget as the key vehicle evaluation of the targeting to discuss broader strategy of total ARTF resources. to align the reconstruction instrument and operational with the government and Ministries of Public Health, evaluation of the proposed ARTF Management in the Foreign Affairs, Labor, and program with national new delivery mechanism. If Steering Committee. Social Affairs and Higher development objectives. successful, the scheme will Education have also been be proposed for the national ARTF and Donor major recipients. It should scale up. Contributions: A total of 32 also be highlighted that donors have contributed to the ARTF’s RC Window • Promote transparency A F G H A N I S T A N the ARTF over the past nine resources are national in and accountability of RECONSTRUCTION years. Donor contributions scope, ensuring the payment TRUST FUND have increased year after of salaries of around 400,000 reconstruction assistance year, with new donors joining non-uniformed civil servants The Afghanistan and older donors increasing in all 34 provinces of the Reconstruction Trust Fund their levels of contribution. country. Steady year-on-year • Reduce the burden (ARTF) is a partnership Nevertheless, over the last increases in operating costs between the international few years the “preferenced” across government mean the on limited government community and the portion of donor contributions RC Window accounts for a capacity while promoting Afghan government for the has been the main factor declining share of the overall improved effectiveness of driving growth. The agreed budget. Nevertheless, the RC capacity-building over the reconstruction effort. ARTF rules are that donors Window still finances around time Since early 2002 until March may not “preference” more half of the non-security costs 20, 2011, 32 donors had than half of their annual of government. • Enhance donor contributed over $4.2 billion, contributions. This rule is to making ARTF the largest ensure that the ARTF has The Investment Window: coordination for financing contributor to the Afghan sufficient funding to finance The Investment Window and policy dialogue. budget—for both operating the Recurrent Cost Window has in the last two years costs and development and that it retains some increased significantly in programs. ARTF’s support flexibility in the approval of volume and scope. In the for national priority programs, National Priority Investment last two years (SY1388 for operating costs of Projects. and SY1389) investment government operations commitments have exceeded and for the policy reform The Recurrent Cost (RC) recurrent cost commitments. agenda is contributing Window ($2.29 billion Disbursement rates on ARTF 16 The ARTF is managed by the World Bank as Administrator of the fund. investment have been very was based on the strategic Corporation (AUWSSC) took strong with 65 percent of total sanitation plan and associated over the existing water supply investments disbursed as of master plan covering and sewerage operations in March 20, 2011. Consistently municipal solid waste, on-site the urban areas. Withdrawal high rates of disbursement sanitation, and sewerage and of about $36 million was are strongly influenced by the storm water drainage. made by the government out sectors in which ARTF invests. of the grant amount of $41 Decentralized and national Implementation of the project million, and withdrawals will rural development programs, was most problematic be allowed until April 30, 2011, such as NSP, NRAP, and throughout the project period, for eligible expenditures. education, have been strongly and the project encountered supported by the ARTF. severe cost and time K a b u l / Ay b a k / M a z a r - e - overruns, which led to project Sharif Power Project ($57 As of March 20, 2011, there restructuring in March 2010 million Grant) is working to were 17 active projects to drastically reduce project provide reliable and quality funded through ARTF, with a scope and scale back project power to consumers in the combined commitment value outcome targets. The grant target areas of the cities of of over $635.19 million; of this, closing date was extended Kabul, Aybak, and Mazar- $559.42 million was disbursed. three times from the original e-Sharif. The project would Full details of investment closing date of December support investments to: (i) activities are provided in the 31, 2007, to December 31, strengthen the low-voltage ARTF Quarterly Reports 2010. The Ministry of Urban distribution network through available at www.worldbank. Development Affairs (MUDA) rehabilitation/upgrading of old org/artf. did not implement the agreed and dilapidated infrastructure action plan to complete the in parts of Kabul with the aim The ARTF-financed Urban ongoing contracts for water of improving the reliability and Water Supply and Sanitation supply in 12 provincial towns, quality of electricity supply and Project (UWSS) provided and the project performance services in the target areas, $41 million to support the was unsatisfactory. In as well as accountability of government’s short-term view of the unsatisfactory power utility; (ii) construct a UWSS program. The project performance and based on the new 220/20 kV substation has five components: Bank’s operational policies on and associated 20 kV lines Kabul water supply, Kabul closing date extension, further at Aybak to provide quality, sanitation, provincial towns extension of the Grant closing reliable, and clean grid power WSS, engineering support date was not considered. to the residents of Aybak and technical assistance, and town; and (iii) rehabilitate and financial support to the Central Except for the construction augment the transmission Authority for Water Supply of the water supply systems facilities for the medium- and Sewerage (CAWSS) in 12 provincial towns and low-voltage distribution operations. The Kabul water where the works remained network in Mazar-e-Sharif. supply and provincial towns partially completed, all In addition, the project would WSS components were based other investment activities support institutional capacity on feasibility studies that were envisaged in the restructured building for operation and completed for Kabul (financed project were completed maintenance of the distribution by KfW) and 11 provincial by grant closing. Financial systems, as well as the capitals served by CAWSS. support to operations, establishment, operation, In addition, the ARTF had effective since August 2005, and handover to DABS (Da financed feasibility studies was terminated in March Afghanistan Brishna Shirkat – for 11 cities which were not 2007. The CAWSS was Afghanistan Power Utility) of served by CAWSS. The liquidated and Afghanistan a customer care center in the Kabul sanitation component Water Supply and Sewerage target area. 17 It was planned to energize 17 Nos Building and Project Management The main project components are of distribution transformers in GSS Support to Ministry of Energy and falling behind schedule. The project feeder 01 before the end January Water (MEW). The project is also will require further extension (from 2011. However, a shortfall of 12m supporting the establishment of a the revised closing date of September poles has delayed meeting this target. unit within MEW to promote energy 2011) for a few months. Ministry Work is continuing on other feeders efficiency and saving. The project of Energy and Water (MEW) and although progress was severely was designed at $60 million. Phase SMEC (the implementing consultancy restricted due to nonavailability of I of the project was started with $35 firm) are working on the revised concrete distribution poles. Civil and million. The proposal for the balance work plan and completion time. The structural design approvals for both of $25 million of ARTF funding has delay was mainly because of issues Aybak and Mazar substations are fully been processed and approved in with acceptance of poles’ technical completed. Construction works of the January 2011, and now the full $60 standards by MEW. Even though boundary wall of Aybak substation million funding is available for the the issue is now resolved, the delay has been completed. Also, leveling project. A one-year extension in the has already affected the project works at Aybak switchyard is nearing project closing date has also been completion time. Terrorist attacks completion. Sixty-one percent of the approved and the new closing date targeting Indians had led the Indian supply items, including 16MVA power is July 31, 2013; the extension will contractors to recall a major part of transformer, have reached the Aybak cover the completion of rehabilitation their work force causing further delays site. of Naghlu and Mahipar Switchyards in execution of some contracts. and the delays in the project that have The construction work of the occurred in the past. The physical progress of the customer care center is completed. Kabul rehabilitation work is slow Procurement of a digital metering The state-owned utility DABM was with only about 72 percent of the package for single and three phase converted to a corporate DABS. It work completed as of March 2011. consumers, base computer stations, was officially formed on May 4, 2008, Delays are being caused by access handheld units, and meter testing sets and took over the assets of DABM difficulties for construction activity; has also been completed. All three on September 30, 2009. Work on the pole procurement contributed shipments of the energy meters, base rehabilitation of distribution works at the maximum delay. In addition, computer stations, handheld units, Pul-e-Khumri and Charikar, Gulbahar delays are also caused by delay in and meter testing sets have arrived and Jabel-es-Seraj is underway. The obtaining permission from Kabul in Kabul and Mazar-e-Sharif. Handing rehabilitation and extension work Municipality and other organizations, over of two lots was completed, and includes 173 km of MV lines, 10 frequent work stoppages by different the third lot is underway. The training km of underground MV cables, 420 organizations and individuals, slow of DABS personnel by the contractor km of LV lines, and 170 distribution progress by the contractor, and slow is completed in Kabul and is in transformers. The contractors have progress in manufacturing of meter progress in Mazar-e-Sharif. completed survey and design work. boxes by DABS. Delays occurred in release of funds, ARTF – Afghanistan Power Sector customs clearance issues, pole Implementation work for Feeder 07 Development Project ($60 million design/quality issues, and extension (pilot project) under Mazar distribution Grant): The project supports the of some of the L/Cs. These issues works was completed and energized Government of Afghanistan in have mostly been resolved. Most of on June 20, 2010, with 20 distribution increasing: (i) access to grid power; the equipment has been procured transformers connected to this and (ii) the quantity of power available and is either being manufactured or new feeder. Approximately 4,500 to consumers in the target urban has already arrived in Afghanistan. In consumers were connected to the centers of Pul-e-Khumri, Charikar, Pul-e-Khumri, the coverage area had new line, having 24-hour electricity Gulbahar and Jabul-Seraj. The to be increased. supply from Mazar substation. Since project consists of the following three then, the work has been delayed and components: Distribution System The project is supporting energy progress in increasing the number Rehabilitation; Rehabilitation of efficiency activities of Ministry of of connections was not being made. Transmission Switchyard Associated Energy and Water. The Bank has Work is in progress at GSS feeder 01 with Naghlu and Mahipur Hydropower already funded the salaries of with 42 Nos distribution transformers. Stations; and Institutional Capacity Energy Efficiency Engineers at MEW 18 Rehabilitation of about 12 kms of existing roads in Kabul city will be completed by May 2011. and is currently discussing funds, and procurement of side drains and walkways; a plan of further support to office facilities is underway. construct roundabouts at key the unit. The project aims The recruitment process for intersections; and install street to strengthen Afghanistan’s the National Energy Efficiency lights. The Implementation capabilities to incorporate Advisor has started. The Consultant (IC) has completed energy efficiency into its core Energy Efficiency Advisor will the topographic survey, energy development strategy lead the recruitment of an geotechnical investigations and mitigate the impacts of international team leader and and design for 75 km of roads high generation costs on also lead the preparation of the under their contract and consumers. The support annual work plan for three main has submitted to the Kabul includes establishment of a unit areas: (a) capacity building Municipality for final approval. within MEW to work in the area of Professional Engineers in Under this project 12 km of of promoting energy efficiency energy audit, implementation the existing roads will be and demand-side measures, of load management, rehabilitated in Kabul city. The including implementation of power factor demand side project has shown notable some pilots; and preparing and management (DSM), (b) an implementation progress in implementing a communication awareness/outreach program, the second quarter where strategy for awareness among and (c) a few demonstration physical progress increased consumers. The Energy projects in Kabul and some from 56 percent to 68 percent Efficiency Cell has been provinces. and disbursement rose from established at MEW. The Bank 45 percent to 54 percent. The is working closely with MEW Two other activities in the construction work is expected for a well planned staffing of energy efficiency area to be completed in May 2011. the Energy Efficiency Unit, so explicitly designed to promote Bank management approved that implementing measures to energy efficiency and demand- the extension of the Grant support energy efficiency work side measures in Afghanistan closing date to December 31, can be effectively undertaken. are: (i) an Energy Efficiency 2011, to allow the outstanding Study for large public buildings project works to be completed A household energy survey in Afghanistan (funded by and fully meet the project has been completed. Results ESMAP); and (ii) an Energy objectives. show that respondents are Assessment (Analytic and willing to pay more for better Advisory Activities (AAA)) Afghanistan On-Farm Water quality electricity, and there is which would identify energy Management Project ($41 awareness of energy saving efficient lighting solutions in million Grant): The project and alternate energy measures. Afghanistan. Both these Bank- is designed to support on- Results of the study were executed studies have been farm water management disseminated in a workshop completed and shared with investments in five provinces on October 6, 2010, which MEW and Inter-ministerial (Herat, Bamyan, Nangarhar, was chaired by the Minister Commission on Energy Balkh, and Kabul) covering a of Energy and Water and participants. total of 175 irrigation schemes attended by Ministry officials. It in approximately 50,000 ha. has been recommended by the Kabul Urban Roads The project’s investments Supervision Consultant to go Improvement Project ($18 include the establishment and to the next stage and address million Grant): The Project strengthening of Irrigation the comments in the Survey by aims to improve traffic flow on Associations, improving on- carrying a Feasibility Study to priority corridors or segments of farm irrigation infrastructure, assess the most critical area the main urban roads in Kabul and disseminating improved where power is needed. Five city. The Project will rehabilitate water saving techniques Professional Engineers have about 12 kms of existing roads; and high efficiency irrigation been hired with the project construct and rehabilitate road systems to farmers. At the 19 same time, the project will invest in capacity building and institutional strengthening of the General Directorate of Irrigation in the Ministry of Agriculture, Irrigation, and Livestock. Afghanistan Justice Sector Reform Project (Phase 1) ($27,75 million Grant): In line with the ANDS and National Justice Sector Strategy (NJSS), the Justice Sector reform project’s (JSRP) objective is to enhance capacity of the justice institution to deliver justice. This should be achieved through more strategic human capital and physical infrastructure management, the increase of the skills of legal professionals, enhancement of the physical infrastructure, the provision of legal aid and legal awareness program. The project implementation started in July 15, 2008 and the project should be completed in June 30, 2011. The project has three components: Enhancing the Capacity of Justice Institutions; Legal Empowerment; and Strengthening Implementation Capacity. Key activities include: (a) Human Resource Management (HRM) (with HRM for Judges and RIMU (Reform Implementation and Management Unit) to support the HRM for court staff, prosecutors and AGO employees); (b) Training and Training Management Capacity (TMC); (c) creation of Central and Provincial Legal Libraries; and (d) International and National Gatherings of Legal Professionals; (e) Legal Aid program; (f) Legal Awareness Program; and (g) Financing the institutional structure for the implementation of the NJSS and the Project. Though with different levels of success, the Justice Institutions have made progress in the course of project implementation. Accomplished results imply that the project is likely to achieve its objectives. The Ministry of Justice has been the strongest performer among the JIs, followed by the Supreme Court. The AGO has made the slowest progress. Building project’s implementation capacity presents by far the biggest challenge for the project. The Management Capacity Program ($35 million Grant) helps ministries to improve their capacity in key managerial areas over the medium term. This enables the government to manage resources more effectively and deliver results faster on the ground. The program funds qualified and highly professional Afghan staff; currently working in NGOs and international agencies, to work in critical positions in government to apply for ‘line’ civil service posts in areas such as financial management, procurement, human resource management, policy and administration. This program directly funds about 100 senior level government positions in about 17 ministries, mostly focused on common functions. These positions are filled through a transparent and merit based recruitment managed by the Independent Administrative Reform and Civil Service Commission (IARCSC). Note: All dollar figures are in US dollar equivalents. IDA (International Development Association) is the World Bank’s concessionary lending arm. THE WORLD BANK IN AFGHANISTAN Website: www.worldbank.org.af Abdul Raouf Zia Benjamin S. Crow Telephone: 0093 (0) 700280800 Telephone: 001 (202) 473-5105 Email: azia@worldbank.org Email: bcrow@worldbank.org House 19, Street 15 1818 H. Street, N.W. Wazir Akbar Khan, Kabul, Afghanistan Washington DC, 20443, USA 20